The Best Stock Trading Tips for Beginners

August 2, 2017

The exchange is unpredictable. Nobody can reliably predict share prices. There are far too many variables. In order to achieve high profits with stock trading, however, stock entry beginners should take the following 10 tips into the consideration. They significantly reduce the risk of loss and start safely into the first shares.

1. Before you buy the shares, get knowledge of the company:

Before you buy shares of a company, you will be well informed about the company, the competitors, and the entire industry. Read company portraits and reports, key figures, analyses and assessments of analysts, charts, as well as up-to-date news. Compare. When you buy a car, you finally want the best for your money. Take this principle when buying shares. Before you start trading, you should also consider which stock investor type you belong to. Please also remember that you do not have to enter the active trade immediately.

Create a sample account and first observe how your favorite shares are developing. Use the information obtained and tests your knowledge first in the sample store. If you have made the right decisions based on your information, you will enter the active trading of equities.

2. Invest only freely available money:

Do you have money left and do not know where to go with it? Then invest this money into stocks. You must have the starting capital for stock trading. You do not need the money now or in 3 or 5 years for anything else. Do not invest in stocks with money from a loan. It is indifferent to you that you lose the money. Only then will you become a good stock investor.

3. Think and act long term:

Do not put yourself under pressure. The shares do not run away from you. If you do not already have the necessary start-up capital or basic knowledge or share information, no course is favorable for you. Always remember long-term trading and act accordingly. Long term means several years to decades.

4. Limit your orders:

Protect yourself from bad surprises and limit your order. Set a maximum price or a minimum price at which you buy or sell the stock. Especially in the case of regional stock exchanges with low stock market volumes or shares of smaller companies or foreign stocks, rapid price fluctuations quickly occur.

5. Buying stocks: Reduce the fees.

Please pay attention to your intended return. If you open a deposit account with a direct bank, you save the costs for the deposit account. Other transaction costs are also lower. Especially for you as a share applicant, small deposit fees are very important. Otherwise, the bank fee may sometimes directly recoup your first profits. Remember, you only invest freely available money. Just when you can only use a few thousand dollars is worth the exact look at the sellers.

6. Set clear yield targets and track them:

When you create a sponge book, you know beforehand how much per cent interest you get per year on the sparing amount. They know and expect this return. Make it similar to stock trading. What is the yield you want to realize during which period?

8. Stay focused:

If you have compiled your account, then maintain and do it on a regular basis. Get involved with the trends, analyses and other relevant news. Invest time and money into your stock trading daily or weekly. For example, you can adjust stop-loss brands continuously and protect yourself against bad surprises in time. Also, stay focused on all key metrics in your stock analysis.

9. Do not buy falling stocks:

Stocks whose price is falling sharply, you do not buy at this time. Watch this stock and wait until the trend reverses. In the assessment of a trend, you can help. Only when a clearly recognizable upward trend begins, you buy the stock. Otherwise, you may experience great losses.

10. Be careful with consultations:

Beginners are often insecure and are gladly advised by bank employees which securities you should buy. On the other hand, there is absolutely no objection. In such consultations, please note that bank advisors often have specific requirements and meet quotas. Therefore, it may be that the advice is more to serve the interest of the employee than to you. Ask why you are recommended this share to you. Also, ask for the investment strategy that serves as the basis for the recommendation. Not always fits this strategy to your own.

Caution also applies to “Hot Tips” from neighbors, friends, and colleagues. Check the recommended stock of “Exchange Experts” yourself. Why should you buy this stock now? And why should not? Get suggestions from consultants, you decide only after your own review of the stock. After all, it’s your money.